Taipei’s Twin Towers project collapses

HOBBLED HUB:The project is to be the main hub for six railway and MRT lines, but imploded when the developer did not meet the deadline to furnish a bond

By Mo Yan-chih / Staff reporter

Work came to a halt at the construction site of the Taipei Twin Towers project next to the Taipei Railway Station yesterday.

Photo: CNA

Cooperation between the Taipei City Government and a multinational consortium on the Taipei Twin Towers project next to the Taipei Railway Station collapsed yesterday when the developer failed to furnish a NT$1.89 billion (US$63.7 million) performance bond.

Taipei City Department of Rapid Transit Systems (DORTS) Commissioner Richard Chen (陳椿亮) confirmed that the consortium, led by Taipei Gateway International Development (太極雙星), has lost its bid for the project and said the city government will start negotiating the contract with the second-priority bidder, BES Engineering Corp (中華工程), to continue with the project’s development.

The NT$70 billion project is one of the most expensive development projects in Taiwan. The collapse of the cooperation came amid speculation that Taipei Gateway International Development is experiencing financial difficulties.

The company had promised to wire US$100 million to the department’s designated bank account by midnight on Thursday to secure the contract and prove its financial strength. It sent a copy of a wire transfer record via fax to the department at 11:42pm on Thursday as confirmation that it paid the performance bond.

Chen and the department had expressed optimism about the cooperation after receiving the fax. However, the department checked with the Taipei Fubon Bank (台北富邦銀行) yesterday morning and found that no money had been transferred to the account.

“It is a requirement for the developer to pay the performance bond to enter into the contract. Since it has failed to do so by the deadline, we will move on to discuss the contract with the second bidder and continue with the procedures. Whether the company had financial difficulty in paying the amount is not our concern,” Chen told a press conference.

The consortium, composed of Taipei Gateway International Development, and IGB and Mid Valley City, both from Malaysia, won the first-priority bid in October last year to develop the two high-rise buildings, which are to serve as the main hub for the Taiwan Taoyuan International Airport MRT line to Taipei and five other railway and MRT lines.

However, since the consortium won the priority, allegations about the company’s financial strength, qualification and bribery have cast a shadow over the project.

Democratic Progressive Party Taipei City Councilor Wang Shi-chien (王世堅) lashed out at the city government, saying it was covering up for the company.

He urged Taipei Mayor Hau Lung-bin (郝龍斌) to apologize for the collapsed cooperation, and demanded that Chen and related department heads take full responsibility and tender their resignations.

“The cooperation is a scheme and the city government has clearly been covering up for the company. Now that the bidding process has proved to be a farce, Hau’s team has lost its credibility and must take full responsibility for the ridiculous project,” Wang said.

Hau declined to comment on the incident and said the department would follow standard procedures in handling the contract.

Chen said the department would reflect on the bidding process and administrative responsibility, but declined to say whether he would offer to resign over the collapsed cooperation.

The project, initiated by President Ma Ying-jeou (馬英九) during his term as Taipei mayor in 2004, suffered four failed bidding processes until the consortium won the first-priority bid in October last year.